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Thursday, April 8, 2010

Debt Collectors Behaving Badly (And How to Make Them Stop)

Debt Collectors Behaving Badly (And How to Make Them Stop)

Debt collectors in certain areas of the country have begun contacting debtors in more and more harassing ways, according to a recent article from WNEP in Pennsylvania.
This situation is troublesome not only because it can cause fear and embarrassment for debt collectors’ victims, but also because such techniques are illegal.

The Slimy Tactics Reported by Victims

While repeated phone calls from a bill collector may be irritating, some of the actions that are being attributed to collectors are downright appalling:
  • Threats of jail time: Some debtors have reportedly been threatened with arrest—even with arrest at their place of employment.
  • Insults: Sources indicate that some collectors have taken to belittling debtors about their level of education and their work ethic.
  • Cruel suggestions: Apparently, some debt collectors have gone so far as to suggest debtors commit suicide as a way to remedy their inability to repay their debts.
  • Neighbor contacts: It seems some collectors have even ducked as low as contacting a person’s neighbors about debts owed.
Clearly, something is wrong here. Debt collectors are not legally allowed to get away with such actions, but unfortunately many consumers aren’t aware that they have rights protected by federal law.

Your Rights and Options

So what exactly are creditors forbidden from doing? Here’s a summary of what actions are prohibited by the Fair Debt Collection Practices Act:
  • Harassing a debtor, her family or her friends
  • Failing to follow up a phone call with written details about a debt within five days
  • Contacting anyone besides the debtor or his lawyer about a debt
  • Physically or verbally threatening a debtor
  • Suggesting or implying that a debtor can be arrested when she legally cannot
  • Lying about the amount of the debt owed
  • Contacting the debtor directly when he has known legal representation
  • Ignoring a debtor’s written denial of a debt
The collectors mentioned in the story above were breaking the law—but unless the debtors are aware of the laws protecting them, they’re not likely to take any action.

Halt Creditors with the Automatic Stay

If you’re facing aggressive behavior from a creditor, it may be time to consider working with a legal professional. One option for stopping creditor contacts is filing for bankruptcy, which will trigger an automatic stay that blocks all contact from creditors.

Additional Resources

Fair Debt Collection Practices Act (PDF)

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